The advent of Fintech is shifting more power to customers with online services that compete with and could ultimately reduce the market share of primary financial services institutions (FSIs). Fintech relies extensively on data analytics to deliver value to customers with lower costs and fees.

On the other hand, the Fintech industry is experiencing growing pains related to the pace of innovation, the speed of mainstream adoption and user expectations.

Fintech is a hot buzzword, but its tangible effect is real and immediate. Change is now. This shift is being felt across the board, from Fintech startups, to companies developing an enterprise strategy around it, and any service-based business coping with the financial transformation of its industry.

We see many Fintech examples emerging, including Grow, Borrowell, Lendful and Wealthsimple, to name but a few.

If you are a Fintech startup, incubators and accelerators such as Toronto’s MaRS Discovery District, Kitchener-Waterloo’s Communitech, and Kanata’s L-Spark for Software-as-a-Service startups, are effective avenues to support your development and growth.

You can’t outspend a major bank, but you can be more innovative and even potentially partner with them.

Banks, credit unions and other large regulated entities are not about to let the Fintech express pass them by, though they have yet to release clear strategies for adoption and integration.

Scotiabank, for example, has a $2-billion Fintech war chest. In June, it partnered with online lender Kabbage to offer small business loans. RBC has launched an innovation lab in Silicon Valley to work with local Fintech startups.

As a Fintech startup, it’s important to bear in mind that you can take advantage of:

Partnering/seed funding from angels, VCs, banks and other FSIs
Incubators and accelerators
In house R&D and partner R&D, to take advantage of government incentives such as the Canadian Scientific Research & Experimental Development Tax Incentive Program (SR&ED)
Licensing and contracting for services
At MNP, we can help Fintech startups at the incorporation/structuring stage by introducing them to funding sources, assisting with applications for government programs, development and beta testing, and keeping them apprised of the latest market trends and developments.

We can even foster partnerships as we serve several of the large regulated FSIs and numerous Fintech startups across Canada.